Airline pricing is often treated as a reactive afterthought; however, setting a price for a product is one of the most important decisions an airline can make. Too often, airlines adopt the “me too” approach to pricing, basing fares solely on what competitors are doing and often in an extremely reactive way. But airlines are missing a key piece: how much value do customers believe the products actually deliver?
In an industry constantly pressured by how to increase revenue, pricing is a lever that has seemingly been untapped. Today, if airlines truly want to achieve total revenue optimization (TRO), they must look beyond traditional revenue management. They must tap into adopting mature pricing practices that consider a more scientific and strategic approach.
Ultimately, if airlines engage in their pricing strategies and let it take a lead in telling their story of who they want to be, they have the opportunity to increase customer satisfaction, discover unique points of differentiation and achieve total revenue optimization.